A Japanese controlled metal parts trader has become the first foreign-owned company allowed to make an initial public offering in China, reported Bloomberg. Ningbo Tongmuo New Materials is 60 per cent owned by Mitsumi Special Alloy Industry and it hopes to raise about Yn400m from the sale.
Other foreign companies such as Unilever have expressed interest in listing on the mainland. In addition to tapping into Asia's second- largest stock market, foreign firms might benefit from the ability to raise funds for local expansion and gain a higher profile in this increasingly important market.
The Chinese government decided in 2001 to allow foreign firms to sell shares in China incorporated companies in which they held a stake of at least 25 per cent.